California transparency in supply chains act: Everything you need to know

What is the California Transparency in Supply Chains Act?

California enacted the Transparency in Supply Chains Act to address the lack of visibility consumers faced when buying goods linked to complex global supply chains. Lawmakers explicitly recognized that slavery and human trafficking exist in every country, including the United States, and that these abuses are often hidden and difficult to trace within normal commercial operations.

The Act is a disclosure law, not a conduct mandate. It requires certain retail sellers and manufacturers doing business in California to publicly state whether and how they work to eradicate slavery and human trafficking from their direct supply chains for tangible goods offered for sale. The goal is to give access to clear, comparable information that supports informed purchasing decisions and enables public accountability.

The legislation focuses on transparency across five defined areas: verification of supply chains, supplier audits, supplier certifications, internal accountability standards, and employee training for supply chain management. Companies must disclose the extent of their efforts in each area, including stating explicitly when no such efforts exist.

By requiring public disclosure, the Act aims to shift visibility upstream and make supply chain practices easier for consumers, regulators, and other stakeholders to assess.

Who does the California Transparency in Supply Chains Act (CTSCA) apply to?

Many companies fall within the scope of the Act even though they do not operate a headquarters or production site in California. Coverage is determined by business activity and scale, not where your organization is based.

The Act applies to retail sellers and manufacturers that meet all three of the following conditions:

• You identify as a retail seller or manufacturer on your California state tax returns.
  
• You do business in the state of California, using the definition set out in California Revenue and Taxation Code section 23101, which focuses on commercial activity rather than physical presence alone.
  
• Your annual worldwide gross receipts exceed $100 million. 

Businesses headquartered outside California, including global brands selling goods into the U.S. market, can still fall within scope when commercial activity meets California’s definition of doing business. The law does not distinguish between domestic and foreign-owned companies, nor does it limit coverage to in-state operations.

If your organization manages complex supplier networks tied to supply chain transparency expectations or reports publicly on sustainability, this eligibility check is often where CTSCA obligations surface first.

What does the CTSCA require you to disclose?

Covered companies must publish a statement describing their efforts to address slavery and human trafficking in direct supply chains for tangible goods offered for sale.

The law requires disclosure across five specific areas, stating clearly the extent to which your business engages in each activity, if at all:

1. Verification

Whether you verify product supply chains to evaluate and address risks of slavery and human trafficking, and whether a third party conducts verification.

2. Audits

Whether you audit suppliers to evaluate compliance with company standards, including whether audits are independent and unannounced.

3. Certification

Whether direct suppliers certify that materials incorporated into products comply with slavery and human trafficking laws in the countries where they operate.

4. Internal accountability

Whether you maintain accountability standards and procedures for employees or contractors who fail to meet company standards on slavery and human trafficking.

5. Training

Whether employees and management with direct responsibility for supply chain management receive training on slavery and human trafficking risks.

If your company has a website, the disclosure must be accessible through a “conspicuous and easily understood link” on the homepage. Companies without a website must provide the same disclosure in writing within 30 days of a written consumer request.

What practical steps help you comply with the Act?

Companies often meet the disclosure requirement only after realizing that information sits across legal, sourcing, HR, and sustainability teams. A basic compliance checklist helps you identify gaps before posting your required supply chain disclosure on your website. Use this checklist to assess readiness:

• Confirm whether you are in scope
  Verify retail seller or manufacturer status, worldwide revenue above $100 million, and whether your business activity meets California’s definition of doing business.
• Review existing policies and controls
  Identify current supplier standards, audits, certifications, accountability procedures, and training tied to slavery and human trafficking.
• Collect supporting data and records
  Gather documentation that supports each disclosure area, including supplier certifications, audit practices, and training programs.
• Prepare and review your disclosure statement
  Draft clear disclosures for all five required areas, stating explicitly where no action is taken.
• Check alignment with ESG and transparency reporting
  Ensure consistency with broader supply chain transparency and sustainability disclosures already published elsewhere.

What role does PIM play in meeting CTSCA disclosure requirements?

CTSCA disclosure relies on accurate, auditable information about products and suppliers. You’re expected to describe where products originate, which suppliers are involved, and how verification, audits, certifications, internal accountability, and training apply across direct supply chains. Problems usually surface when your product and supplier information is stored across multiple systems, owned by different teams, or maintained in inconsistent formats.

A product information management (PIM) system helps you consolidate that information into a single, usable structure. PIM aggregates product and supplier data from sourcing, compliance, sustainability, and third-party inputs, then connects it at the product level so you can see what applies to each item you sell. Centralizing that data makes your CTSCA disclosure easier to prepare, review internally, and update as conditions change.

Building a structured, product-centric data foundation also puts you in a stronger position to reuse that information for Digital Product Passport initiatives and related regulations. The same foundation supports PIM for retail use cases where transparency, consistency, and traceability shape how customers and partners evaluate your products.

Can your product data support public transparency?

CTSCA puts your disclosures in plain sight, so gaps in product and supplier information become visible quickly. You rely on consistent data to explain where products come from, which suppliers are involved, and how policies apply across your supply chain. 

When that information is fragmented, keeping disclosures accurate turns into ongoing manual work. You need data that stays structured and product-centric; this way, maintaining transparency becomes easier as requirements expand. 

Are you confident your current data setup can support that level of scrutiny without slowing your teams down? Book a demo to see how Inriver PIM supports disclosure-ready product information.